What is Convergence and Divergence?

During an upward trend, when desire or tendency for more Buy orders is decreasing and market has been saturated from Buy orders, despite of probable further upward movement, a reversal point is going to appear. This is called Divergence.

On the other hand, if on a downward trend, tendency to place more Sell orders is diminishing then a reversal point toward top will appear, known as convergence.

Traders can detect it by utilizing significant indicators and oscillator such as Stochastic, RSI, AO and MACD to monitor whether overbought or oversold conditions have happened.

Traders can find out three situations; little supporting trades on current trend are being ordered, most supporting trades are being closed or a lot of trades in opposition to the current trend are ordered.

Each one of those cases may have different rate of influence on trend direction, however, all of them indicates that current market trend is saturated and a reversal price, appropriate for entry price of an order, is going to appear.

While RSI demonstrates overbought or oversold conditions by comparing magnitude of recent gains to recent losses within a period of time, Stochastic helps traders by considering the current close price against Highest or Lowest price in current trend.

Features of Convergence and Divergence in Technical Analysis

Applicable on all markets
Serviceable on all financial markets around the world and symbols
End of a trend alert
Reversal point of current trend can be detected by this technical analysis
Saturation of Buy/Sell orders on certain market trend can be indicated
Great efficacy
Future market trend can be determined with high probability
Useful for Scalpers
Beneficial technical analysis for scalpers to open orders at the beginning of a trend
Short-Term specs
Good for orders with short-term expectancy
Confirmation of closing an order
Traders can detect appropriate and inevitable reversal point to close agreeing orders with current trend
Suitable for short trades
Traders can use this technical analysis to place short trades with little ST and TP

Traders can use this technical analysis to place short trades with little ST and TP

Utilizable on ALL financial markets
We generate our sound and magnificent analysis on all tradable symbols and financial markets
Most powerful and profitable technical analysis
Our system utilizes both RSI and Stochastic separately to figure out the most suitable divergences and convergences
Modified and perfect patterns
Our professional R&D team has developed robust and flawless divergence detector with precise monitoring and unique definition in which divergence and convergence technical analysis would only be generated after two consecutive divergences or convergences have been formed
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Our technical team have developed application for both iOS and Android cell phones and tablets
Attainable via Desktop App (Linux and Windows)
Desktop application can be executed on Linux and Windows operating systems
Real-time notifications and online updates
In order to trade successfully, traders must have valid and well-timed information and technical analysis, hence our system delivers high quality technical analysis instantly. Providing any changes in market speculation and analysis, updates on our technical analysis would be delivered promptly.
Variable Pips
Technical analysis of convergence and divergence offers different TP and SL prices based on market trend conditions and confirmations
Timely alert
Immediate alert will be generated after entry price has been touched
We provide our technical analysis on all available time frames

Convergence and Divergence

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